Nick Szabo: Gold lost to Bitcoin not because it is worthless, but because it is too easy to control.

The concept of smart contracts was recently brought up by Nick Szabo, who threw out a controversial viewpoint: gold has lost its crown as the king of currency not because it is no longer valuable, but because its fundamental flaw is that it is too easily controlled.

His logic is straightforward: storing gold bars in a bank essentially means entrusting your fate to an intermediary. Physical gold is vulnerable to theft and robbery, ultimately relying on “trusted third parties” for safekeeping, and this system inherently carries the risk of abuse. Ironically, this statement coincides with the BTC/gold price ratio dropping to a several-month low.

Szabo believes that the higher the gold price rises, the clearer the problem becomes—the traditional custody logic of precious metals is outdated. The anonymous and decentralized design of Bitcoin directly addresses this systemic flaw of “your gold is not necessarily your gold.”